Archive for the ‘innovation’ Category

Many small and medium enterprises (SMEs) are missing the opportunity to use online tools to run their core business better by: cutting costs, reaching customers and suppliers, innovating and getting more control over their business, according to a new Grattan Institute discussion paper.

Businesses with less than 200 employees employ two-thirds of private sector workers and contribute more than half of Australia’s private sector GDP and if advanced online technology becomes the norm among SMEs, the productivity gains would spread through the whole economy.

There are four big opportunities for SMEs to use online tools more effectively: mobile, social, data analytics, and the cloud. The paper says:

only 18% of Australian SMEs with an internet connection have developed mobile-optimised websites.

only a quarter of Australian SMEs with an internet connection say they use social networking for marketing purposes.

many SMEs haven’t realised the full potential of data analytics to understand their customer segments.

only 8% of Australian SME managers say they use the cloud. But 47% of SMEs with an internet connection use basic cloud computing services such as webmail or cloud data storage.

All four opportunities can help small firms win where before they would have lost to larger firms that could absorb the fixed costs of corporate IT.

One Australian digital startup will be selected to receive $5 million in funding, thanks to The Big Pitch, a competition run by Melbourne venture capital fund Oxygen Ventures.

In addition to funding, Oxygen Ventures is offering mentoring and operational support to the winner. Applications close on June 5.

Five finalists will be selected to pitch in front of an audience and an expert panel that includes Dodo founder Larry Kestelman, Network Ten executive general manager Russel Howcroft and BlueChilli founder Sebastien Eckersley-Maslin.

The Keane family started their organic fruit and vegetable delivery business, Keane’s Organic Food almost by accident in 2008 and thanks to a cleverly designed website, it’s been growing ever since.

Melissa Keane, a former marketing executive at the University of South Australia, runs the business with her husband Simon, a former South Australia Police detective and their daughter Millie.

The couple set up the business in 2008 as a part-time co-operative venture, sourcing and delivering organic produce in bulk for a few neighbours in the Unley area.

“I’ve always eaten organic food for its nutrition and taste, but when I was pregnant I wanted to find an easier way to purchase it in bulk and did a simple letterbox drop in my street to see who was interested in a co-op arrangement,” Melissa says. “The demand among other mums was clearly there, and before we knew it our business was born. In the past three years alone, sales have increased threefold and we’ve now employed two part-time delivery drivers to support our growth into new regions.”

Most of the orders come from mums who have little time and some older people.

Growing demand through mostly word-of-mouth referrals led to the more formal set up as Keane’s Organic Food, which now delivers to multiple regions within South Australia.

Australian entrepreneur Mark Middo aims to share his business knowledge with the world in his new book 5 Minute Business.

Middo and a business partner founded online voting system Reminisce Entertainment, which nightclubs use to allow patrons to vote for what songs they want to hear on a certain night. Prior to that, he started his own online company and sold it three months later.

In his new book, Middo explains how people can go from simply having an idea to bringing it to life in five minutes.

“I believe freedom can be built online, and I would like to share my framework to help people do something they love rather than trading their precious time on this earth for money through the outdated 9-5,” says Middo. “I was lucky enough to escape the 9-5 by applying these techniques, and I want to share them with the world.”

The majority of Australians are interested in having a go at entrepreneurship, according to a new global report into attitudes towards self-employment and entrepreneurship.

The 2013 Amway Global Entrepreneurship Report surveyed over 26,000 people across 24 countries and Australia had the third highest rate of positive sentiment towards entrepreneurship with 84% of respondents. That was 3% behind world leaders Finland and Denmark and 14% above the international average.

The study found the leading reason for pursuing entrepreneurship was independence and the opportunity to be one’s own boss. In Australia, 62% of respondents listed those as key attractions.

Pro-entrepreneurial spirit was especially high among Generation Y respondents, with 83% saying they were keen to become their own bosses.

Fear of failure was cited by two thirds of the respondents globally as an obstacle to starting their own business with just over half of Australian respondents (53%) reporting it as an issue.

For Australians reporting a fear of failure as an obstacle to launching a business, the leading concerns were financial burdens up to bankruptcy (38%), threat of an economic crisis (20%), threat of unemployment (15%) and legal consequences such as lawsuits (12%).

The CEO of Australian online payment gateway provider eWay has taken it upon himself to try and coax more Australian businesses to embrace ecommerce by dramatically overhauling the speed at which businesses can gain a merchant account and get paid after transacting.

“We are going to change the speed of how long it takes to get a merchant account. Right now, if you try to get a merchant account, it takes four weeks, six weeks, six months,” eWay CEO and founder Matt Bullock says. “We are pushing it down to four days, and then we will change that down to four hours next year, then eventually get that down to nought hours. That is by getting rid of a whole bunch of banking processes which are busted, and us fixing them and doing them properly.”

The increased speed comes at a price: 2.2 percent and AU$0.30 per transaction, and an AU$25 per month fee. However, that also includes 24/7 support, which banks don’t offer.

Bullock says the higher cost won’t deter merchants, as they are more concerned with the issue of the time taken to get online, get trading, and get paid.

“You talk to the [payment] gateway [company], they say, ‘go away and talk to a bank’,” Bullock says. “You talk to the bank, and that is a long and painful process; sometimes you finish through it and sometimes you don’t. We’re saying, ‘talk to us, you don’t need to talk to your bank. We will do it all and we’ll do it quicker than the banks have ever done it before.’”

His favourite piece of advice is a crucial one for business owners, who always need to be prepared with a back-up plan.

“Never walk into a room that you can’t walk out of,” he says.

“The person who said it to me was Brett Chenoweth, an old friend and the former CEO of APN. He swears by it,” Taylor says.

3. Mick Liubinskas — Pollenizer founder – Run the numbers

When Liubinskas enjoyed a short stint at IBM, he met a friend — Kurt Bilderback — who told him to “always run the numbers”.

“Mick, you’ve got to run the numbers. Always. Not to get answers, but to know what the questions should be.”

4. Gabby Leibovich — The difference between success and failure

Leibovich said his favourite piece of advice was actually something he received just a couple of weeks ago from retail entrepreneur Joe Segal:“The problem with people is not that they aim too high and fail, but that they aim too low and succeed.”

5. Gary Ng — manager of E-Web Marketing, a digital agency which has won several BRW “Best Place to Work” awards — Get rid of the rules

His favourite piece of advice was provided to him by his mentor, Anthony Robbins: “The more rules you have about how people have to be, how life has to be for you to be happy, the less happy you’re going to be.”

6. Bruce Billson — Australia’s Small Business Minister — Get to work

His favourite piece of advice actually comes from Jason Gehrke, franchising expert: “For every $1000 you plan to invest in your business spend an hour of due diligence, planning and working out how you can profitably engage your customers.”

His favourite is a mantra for good customer service — although he can’t quite remember who told him the proverb.

“Customers have your best ideas,” he says.

8. John Winning — head of Appliances Online — Control the supply chain

Winning’s favourite piece of business advice actually comes from his grandfather:

“You can’t control what you sell something for; all you can control is what you buy something for. The market controls the sell price, so the only thing you can control is the supplier relationship and this will help you remain competitive.”

9. Andre Eikmeier — Co-founder of Vinomofo — Be careful what you spend money on

His favourite piece of advice comes from his “biggest inspiration”, entrepreneur Seth Godin.

“Don’t spend your resources on ‘customer acquisition’,” he says.

10. Tristan White — Founder of aged healthcare business The Physio Co. — Don’t try to do too much at once

His best piece of advice comes from George Nadaff, the founder of the American fast food chain Boston Market: “You can’t sit on two toilets.”

After filling niches in the emerging group buying marketplace and giving a new twist to the classic auction website, cousins and co-founders Matt and Elliott Donazzan’s pay-to-bid auction sites are now bringing in over $100,000 per month in revenue.

One Cent Flights and One Cent Wines allow users to bid on flights and wine, respectively, for lower prices. The sites put a new twist on the auction site by charging people for bids.

And the sites have taken off so much, the two entrepreneurs have sent their wine and travel company partners significant volumes of traffic.

The Donazzans have hit on a workable model and they’ve recently launched a fundraising round to raise between $1 million and $5 million.

“A year ago we were a little start-up, and we’re not a massive business yet, but we’re a niche database player that is getting some success at an early stage,” Donazzan says.

He says their database is currently at just over 200,000 users, and they’re growing by 10,000 a month. They’re aiming to get to two million users in the next 12 to 24 months.

One Cent Flights launched in August 2012. The idea emerged from gaps they kept spotting as Matt was exploring group buying sites and Elliott was running his own eBay business.

“We thought if we focused on specific product niches that people really wanted rather than the broad approach of group buying sites, we could build something big,” Donazzan says. “We launched with flights because we noticed the other pay to bid sites were focused on male-centric products. So we saw a big untapped opportunity with online businesses only ignoring a big part of society and consumers,” he says. “We did a whole bunch of focus groups, and the topic that came up again and again was travel.”

He describes their model of seeking a customer first and then creating a product for them has worked well for their rapid growth.

They expanded into wines after it was the lead product identified by focus groups with another market they believed was overlooked by group buying sites, men over 35.

With plans to expand internationally, primarily into South East Asia, Donazzan says the funds they’re raising will go towards expanding their team of five.

A recent report shows that Australia now leads the world in the pace of online business start-ups. Internet start-ups have increased 200% from 2010 and 2012, four times the pace in the United States and Britain.

With so many new startups popping up, Dynamic Business has released a set of tips for Australians who want to get in on all the startup action:

Manage your time. Whether you’re an early riser or prefer burning the midnight oil, find what works best for you. Running a store can require a lot of time and energy, but it’s important to separate your stress. Don’t let the worries of one job impact another and develop (and stick to) a routine that maximises productivity.

Think easy. Great designs are nice, but if your online store isn’t intuitive for customers, all bets are off. Re-evaluate the functionality of your homepage and make sure customers can get to where they’re trying to go.

Focus on quality. Use high-resolution product images and take the time to write detailed product descriptions from a customer’s perspective. If you want customers to spend the time reading it, spend the time writing it!

Try new forms of marketing. One of the most critical aspects for any online store is marketing, but it can be costly. Content marketing, such as blogging, is a great, low-cost alternative and offers small businesses a big bang for your buck.

Find your inspiration. Ultimately, success often boils down to having the passion and drive to keep things running through the highs and lows. When the going gets tough, remember what inspired you to start your own business. If you’re doing something you love, your passion will shine through and motivate to push on.